CORRECTED: Prime Healthcare Hit With $50M Medicare Overbilling Suit

By Erica Teichert (January 8, 2014, 2:16 PM EST) -- Prime Healthcare Services Inc. overcharged Medicare and Medicaid about $50 million for patient stays by deliberately falsifying admissions information, an employee whistleblower alleges in a False Claims Act suit unsealed Tuesday.

In an amended qui tam complaint in California federal court, relator Karin Berntsen claims PHS ordered hospital personnel to charge Medicare the highest possible rates for patient admissions and include comorbidities and complications to further boost their payments. The company allegedly eliminated observation stays and refused to discharge patients to post-acute care centers in order to further defraud Medicare.

Berntsen was employed by PHS in various director roles related to...

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